Is Netflix Reducing Its Prices In India?

It was in October that chief product officer of Netflix, Greg Peters gave hope to Indians that we could finally afford our own Netflix account.

We’ll experiment with other pricing models, not only for India but around the world that will allow us to broaden access by providing a pricing tier that sits below our current lowest tier.” he said.

But all that was short lived as Netflix chief executive Reed Hastings recently said that the streaming giant has no plans for a cheaper price package for one of its biggest competitive markets and that the comment by Greg Peters suggesting otherwise had been “misunderstood” by many.

Netflix is priced more than its rivals in India

Pricing experiments or no experiment?

Netflix has a three-tier pricing scheme in India: Rs. 500 for its basic plan, Rs. 650 for a standard plan and Rs. 800 for its premium plan. To my surprise, the prices applicable in India are already lesser than those offered in the United States.

Hastings pointed out that in India there is a mix across these three plans similar to those in other countries like the US, which does not highlight a pricing issue. Also, if a lower plan than this was to be introduced everyone would be on the lower price plan according to Hastings.

When asked directly in an interview with Reuters on Friday, about whether the company had no plans for lower prices in India, he said: “Correct”.

Industry specialists and even the common audience think that Netflix’s high pricing scheme makes it hard to compete with the likes of Hotstar, Amazon Prime and TV provider Tata Sky.

But Hastings thinks otherwise.

“Now it is true that YouTube is free, and Amazon is basically free, and cable is extremely inexpensive because it’s ad-supported. To some degree that creates a consumer expectation,” he said. But he added that the cost of Netflix in India was “like going to the movie theatre 2-3 tickets a month, but you get to watch a lot more.”

Netflix India’s partnership with Airtel and Videocon has also bought them success in India

So how will Netflix woo Indians?

Hastings has acknowledged that there are limitations in the current pricing strategy at Netflix but called the high-end focus on English language and English-entertainment households “a practical and realistic” place to start, hoping to attract a wider audience.

In a country like India, where online streaming video consumption is at an all-time high, the introduction of its first Indian exclusive sitcom Sacred Games unlocked Netflix’s passage to the young tech-savvy generation of India.

Keeping this strategy in mind which made them a big hit amongst the Indian audience, Netflix in an event in Singapore introduced some new original productions for India, indicating once again how serious they are about the Indian market.

The new slate of originals from India include eight films, including productions by Priyanka Chopra, Anushka Sharma, and Madhuri Dixit along with a web-series set in Goa.

The new originals are going to be streamed in languages including English, Hindi, and Marathi, signalling Netflix’s intention to capture the vernacular video audience.

Typewriter, the original web-series based in Goa is a supernatural drama set in a haunted house.

While announcing these new movies and shows in Singapore, Ted Sarandos, Chief Content Officer at Netflix, said:

“We celebrate India today with an incredible line-up of original films and series that are right now filming across India. This line-up cuts across genres from horror to fantasy and in locations from Leh to Mumbai. The breadth of stories with its local settings and complex characters is incredible and we can’t wait for people to discover and fall in love with them.”

Netflix has more than 130 million subscribers worldwide and Hastings has no doubt that the Indian market could deliver the next 100 million.